Estonia is worried over defence spending cuts by NATO member states, President Toomas Hendrik Ilves said on Wednesday. “Allied spending, required to maintain NATO’s defence capability, is a matter of trust in the organization,” Ilves told Knud Bartels，chairman of NATO’s Military Committee, on a two day visit in Tallinn.

Estonia’s defence spending in 2012 rose by 21.8 percent to 341 million Euros. The government is under an obligation to raise defence spending to 2 percent of GDP. NATO has adopted a Smart Defence “austerity” program in times when “each euro, dollar or pound sterling counts” which prioritizes pooling and sharing capabilities, setting priorities and coordinating efforts better.

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Nearly 25,000 Estonians expressed support to farmers

24,859 Estonian people signed the petition of farmers that demands equal competitive conditions for Estonia, Latvian and Lithuanian agricultural producers with the rest of Europe, Public Broadcasting reports. 22,981 gave their real signature, 24 digital signature, 826 supported the statement at the web pages petitsioon.com and petitsioon.ee and 1,028 people via Facebook.

In Latvia, 18,710 support signatures and in Lithuania nearly 20,000 signatures were collected. On Thursday, representatives of Estonian, Latvian and Lithuanian farmers’ organizations will meet in Brussels with European Parliament President Martin Schulz and will hand him over the petition and the over 63,500 support signatures. The signatures will be also delivered to European Commission President Jose Manuel Barroso.

Currently the EU agricultural subsidies for the Baltic states are the lowest in the EU – the average EU direct subsidies level is 269 euros per hectare while in Estonia it is 117, Latvia 97 and Lithuania 144 euros. According to the current proposals of the EU, direct subsidies will increase by 2020 to just 159 euro in Estonia, 145 in Latvia and 177 in Lithuania.

At a cabinet sitting last week, the government of Estonia discussed, as a supplemental agenda item, schemes for compensating expenses stemming from the discontinuation of fiscal marking of motor fuel, the government's press service reported. The government discussed that the tax exceptions for fiscally marked fuel would be abolished in the railway and marine sector and the costs related to rise in excise duty would be compensated by the state through other subsidies by 2014 at the latest. The Ministry of Finance submitted to the cabinet a proposal to abolish tax exceptions on fuel excise effective 2013 and to apply subsidization schemes related to the discontinuation of fiscally marked fuel in the marine, fishing, agriculture and railway sector. The government decided that the tax exceptions for fiscally marked fuel would be abolished first in the railway and marine sector and that the costs related to rise in excise would be compensated by the state through other subsidies by 2014 at the latest.

Among others, this affects railway transport undertakings – in particular Edelaraudtee AS, which is bound by a public service contract, and which could be compensated for the expenses through reducing the fee for usage of railway infrastructure or increasing the state subsidy payable for organizing passenger transport. The Ministry of Economic Affairs and Communications will first submit an application for assistance for supporting companies in the marine sector to the European Commission. It was also decided that from 2014, the state would develop an assistance measure for replacing heating sources in households fuelled by oil heating.

Thus far, Estonia allows the use of diesel fuel and light fuel oil at a discounted rate in very many fields. This has led to significant administrative expenses for the Tax and Customs Board. In the estimation of the Ministry of Finance, the greatest expense is verifying the entire supply chain of fiscally marked liquid fuel for reducing risks of removal of fiscal markers, as well as inspections on roads for detecting misuse of fiscally marked liquid fuels, and the checks of monthly reports submitted by fuel sellers on movements and sales of fuels. Fiscal marking of liquid fuels also entails costs to fuel handlers who come into direct or indirect contact with the fuels.